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Monthly Archives: August 2012

This week we’re stepping outside of our normal topics of discussion and moving to something pretty relevant for this time of year. Hurricane preparedness.

All along the East Coast and Gulf Coast over the last week, families have been preparing for the latest tropical disturbance, Isaac.

Isaac reached Hurricane strength this afternoon and should reach the coast of Louisiana this evening. Although many times, hurricane preparations turn out to be needless as a storm takes an unexpected turn, most people remember storms like Katrina (2005) and Hugo (1989) and know just how important that preparation can be.

One family from the panhandle of Florida has to board up their windows, build sandbag walls around their home, pack most of their belongings and evacuate multiple times a year. Most of the time they come back home to everything exactly as they left it, unpack and carry on with their lives, but they’ve seen enough destruction over the years to know how important it is to be prepared.

“I’ve lived here on the Florida coast all my life,” says 62 year old Johnny Rivers, “And we have lots of false alarms, but when you come back after a big one, and your refrigerator has been smashed through your ceiling into the upstairs, you are glad you left. We have friends and neighbors that we will try to warn, and some think they want to stay and stick it out. We’ve heard horror stories when we returned.”

“They always say they should have listened to Johnny,” His wife Nan adds. “And now every time there’s a storm they come back to him to see what they should do. They say, ‘We’re going to do whatever Johnny does!’ Because they know that he leaves when he should.”

Like the Rivers family, all families should take the time to think ahead during hurricane season to be as safe as possible. According to the ready.gov Website there are a lot of things we can do to be safe, before during and after a storm. Here’s the breakdown:

BEFORE

To begin preparing, you should build an emergency kit and make a family communications plan.

Know your surroundings.

Learn the elevation level of your property and whether the land is flood-prone. This will help you know how your property will be affected when storm surge or tidal flooding are forecasted.

Identify levees and dams in your area and determine whether they pose a hazard to you.

Learn community hurricane evacuation routes and how to find higher ground. Determine where you would go and how you would get there if you needed to evacuate.

Make plans to secure your property:

Cover all of your home’s windows. Permanent storm shutters offer the best protection for windows. A second option is to board up windows with 5/8” marine plywood, cut to fit and ready to install. Tape does not prevent windows from breaking.

Install straps or additional clips to securely fasten your roof to the frame structure. This will reduce roof damage.

Be sure trees and shrubs around your home are well trimmed so they are more wind resistant.

Turn off utilities if instructed to do so. Otherwise, turn the refrigerator thermostat to its coldest setting and keep its doors closed.

Turn off propane tanks

Avoid using the phone, except for serious emergencies.

Moor your boat if time permits.

Ensure a supply of water for sanitary purpose such as cleaning and flushing toilets. Fill the bathtub and other larger containers with water.

Find out how to keep food safe during and after and emergency.

You should evacuate under the following conditions:

If you are directed by local authorities to do so. Be sure to follow their instructions.

If you live in a mobile home or temporary structure – such shelter are particularly hazardous during hurricane no matter how well fastened to the ground.

If you live in a high-rise building – hurricane winds are stronger at higher elevations.

If you live on the coast, on a floodplain, near a river, or on an island waterway.

If you are unable to evacuate, go to your wind-safe room. If you do not have one, follow these guidelines:

Stay indoors during the hurricane and away from windows and glass doors.

Close all interior doors – secure and brace external doors.

Keep curtains and blinds closed. Do not be fooled if there is a lull; it could be the eye of the storm – winds will pick up again.

Take refuge in a small interior room, closet or hallway on the lowest level.

Lie on the floor under a table or another sturdy object.

Avoid elevators.

AFTER

Continue listening to a NOAA Weather Radio or the local news for the latest updates.

Stay alert for extended rainfall and subsequent flooding even after the hurricane or tropical storm has ended.

If you have become separated from your family, use your family communications plan or contact FEMA or the American Red Cross.

FEMA has established the National Emergency Family Registry and Locator System (NEFRLS), which has been developed to help reunite families who are separated during a disaster. The NEFRLS system will enable displaced individuals the ability to enter personal information into a website database so that they can be located by others during a disaster.

The American Red Cross also maintains a database to help you find family. Contact the local American Red Cross chapter where you are staying for information. Do not contact the chapter in the disaster area.

If you evacuated, return home only when officials say it is safe.

If you cannot return home and have immediate housing needs. Text SHELTER + your ZIP code to 43362 (4FEMA) to find the nearest shelter in your area (example: shelter 12345).

For those who have longer-term housing needs, FEMA offers several types of assistance, including services and grants to help people repair their homes and find replacement housing. Apply for assistance or search for information about housing rental resources

Drive only if necessary and avoid flooded roads and washed¬ out bridges. Stay off the streets. If you must go out watch for fallen objects; downed electrical wires; and weakened walls, bridges, roads, and sidewalks.

Keep away from loose or dangling power lines and report them immediately to the power company.

Walk carefully around the outside your home and check for loose power lines, gas leaks and structural damage before entering.

Stay out of any building if you smell gas, floodwaters remain around the building or your home was damaged by fire and the authorities have not declared it safe.

Inspect your home for damage. Take pictures of damage, both of the building and its contents, for insurance purposes. If you have any doubts about safety, have your residence inspected by a qualified building inspector or structural engineer before entering.

Use battery-powered flashlights in the dark. Do NOT use candles. Note: The flashlight should be turned on outside before entering – the battery may produce a spark that could ignite leaking gas, if present.

Watch your pets closely and keep them under your direct control. Watch out for wild animals, especially poisonous snakes. Use a stick to poke through debris.

Avoid drinking or preparing food with tap water until you are sure it’s not contaminated.

Check refrigerated food for spoilage. If in doubt, throw it out.

Wear protective clothing and be cautious when cleaning up to avoid injury.

Use the telephone only for emergency calls.

NEVER use a generator inside homes, garages, crawlspaces, sheds, or similar areas, even when using fans or opening doors and windows for ventilation. Deadly levels of carbon monoxide can quickly build up in these areas and can linger for hours, even after the generator has shut off.

Social Security taxes- They’re taken out of every paycheck. We all see the figures every few weeks on our stub and although a small part of us wishes we could hold onto that money, we know that it’s going towards a good cause, so we let it slide. We are appreciative of a system that is supposed to take care of us after we retire. At least, that’s how it used to be.

When Social Security was enacted in the 1930’s it was a great bargain for its recipients because payroll taxes were very low.

“For the early generations, it was an incredibly good deal,” said Andrew Biggs, a former deputy Social Security commissioner as quoted in a recent Fox News article.* “The government gave you free money and getting free money is popular.”

The article says that if you retired in 1960, you could expect to get back seven times more in benefits than you paid in Social Security taxes and more if you were a low-income worker, as long as you made it to age 78 for men and 81 for women.

However, in recent years those numbers have changed drastically. According to a 2011 study by the Urban Institute, the average married couple retiring last year paid $598,000 in Social Security taxes during their careers and can only expect to collect about $556,000 in benefits if they live into their 80’s.

Fox’s article explains why the decrease is happening.

“The shift among middle-income workers is happening just as millions of baby boomers are reaching retirement, leaving relatively fewer workers behind to pay into the system. It’s coming at a critical time for Social Security, the federal government’s largest program.

“The trustees who oversee Social security say its funds, which have been built up over the past 30 years with surplus payroll taxes, will run dry in 2033 unless Congress acts. At that point, payroll taxes would provide enough revenue each year to pay about 75 percent of benefits.”

This leaves future generations either getting fewer benefits or paying higher taxes, and individuals who fall into this bracket are less than pleased. One recent college graduate states that she recognizes the money she pays in now, isn’t going to be waiting for her when she retires. “If I wanted Social Security 50 years from now I would have to hope that someone else is still working and putting money aside in their paychecks to pay for my Social Security at that point,” she says.

Some have taken a more aggressive approach and opened their own private retirement accounts to ease their worry that Social Security won’t provide adequate benefits in the future.

David Armbruster, Investment Advisor Representative in South Carolina, sees more and more clients of the younger generation, who are interested in finding the best place to invest their funds.

“They know that although their parents and grandparents have been able to rely on Social Security, it may not be there, or be sufficient when their turn rolls around, and they don’t want to take any chances,” he says. “The biggest problem that we see overall when it comes to retirement funding is that costs are going up and benefits are going down. For our younger generations, it is imperative, more so now than ever before, that they be involved in their own retirement planning. IRA, 401K, Roth IRA and other retirement vehicles are becoming more and more important. These younger generations will be responsible for their own retirements. Gone are the days of waiting for Uncle Sam to pass out a paycheck. Self sufficiency is a must.

“There are a lot of wonderful investment vehicles out there. Some of the best programs around right now are annuities. Inside annuities we can find protection from market risk, guaranteed growth moving towards retirement, and guaranteed income once we get to retirement. For many folks, annuities will be the tool that can be used to create their own “social security” checks. Pensions are a thing of the past. Social security is moving that direction quickly. People are going to have to get smarter about their planning or plan on working for a lot longer.”

For more information on the types of products discussed above visit www.cswta.com.

Last week’s blog focused on a program that can help the person managing your affairs after you pass away. https://cswta.wordpress.com/2012/08/06/silent-partner/. In a follow-up to that post, we’d like to reference a recent article found on Yahoo Finance entitled “Life Insurers Pressed on Lost Policies.”*

The article begins by mentioning a woman, named Mary Lou, who was surprised to receive a check for $7,000 more than a decade after the death of her father. The check was from unclaimed life insurance policies her father had taken out previously, that his family had no knowledge of.

At the time of her father’s death, Mary Lou inquired with the insurance company with whom she knew he had policies, to see if there were any other accounts. She was told at the time that they didn’t owe her anything else. As it turns out, that $7,000 check was for three policies that she didn’t have a policy number for.

Mary Lou voices her concern for the situation as it may affect others, “Can you imagine all the millions or billions of dollars that belong to other people and they don’t know to claim it,” she says, in Yahoo’s article?

Backing up Mary Lou’s statement, state regulators estimate that over the decades life insurance companies have failed to pay well over $1 Billion in death benefits. The reason? Because it’s up to the beneficiaries to file a claim following death. One industry official says that whatever the amount is, it’s a “very small percentage” of total claims paid. “We know the percentages represent real people and we’ve been working with policy makers on ways to ensure all policyholders get the benefits they deserve,” said the official, Bruce Ferguson of the American Council of Life Insurers.

Recognizing that new technology can help alleviate this problem, insurance companies in many states are being required to check old unclaimed policies against death databases, and to make payouts to those they owe.

Most insurance companies will probably not fight these regulations. Yahoo’s article went on to state that opposing a requirement to check the databases would be particularly difficult given that many insurance companies already check them when it’s in their interest- for example, to learn about the deaths of annuity customers because such deaths usually end the insurers duty to make payments under retirement-income contracts.

As many such modern systems are slowly being implemented into this industry, the process of handling insurance claims is no doubt going to undergo some changes. The article mentioned above referenced a number of such changes that are already taking place.

Of course we all look forward to a time when this process has been completely ironed out and programs such as “Silent Partner Executor Planning” will no longer be necessary. But in the mean time, the monetary figures mentioned most likely only strengthen your resolve not to be one of the many whose unclaimed benefits make up that staggering $1 Billion.

Taking advantage of a free program to keep you out of that statistic is definitely a wise course.

It’s pretty much understood that planning for the future with products such as retirement packages and Life Insurance are necessary in today’s world. Nobody wants to leave their family members scrambling to come up with funeral expense funds in the wake of losing a loved one!

So, you’ve taken care of this, and that’s great! You have the best interests of your spouse, or children in mind and you have taken definite steps to make that inevitable occurrence a little easier to handle. However, one thing many people neglect to consider is how arduous the process can be when it comes to filing paperwork and handling claims. Especially because sometimes the family members left behind aren’t fully aware of what kinds of plans/policies their deceased loved one even had!

This is where something called a “Silent Partner Program” can really come in handy.

A Silent Partner Program is just another term for an Executor Planning Document and is a way to keep family records organized and up-to-date. This will take a lot of the stress away from someone who is going to be grieving and may find it difficult to navigate the planning process ahead of them.

Many people find it difficult to compile this information and share it with their family members, but fortunately, a number of Retirement Planning companies provide a structured program to manage all of this data.

Usually, a representative from the company will meet with you one on one and walk you through filling out all necessary documents. This will likely include details on the following personal information:

• Personal Documents

• Survivor’s Guide

• Family Data

• Safe Deposit Box Inventory

• Contacts

• Budgeting

• Additional Sources of Help

• Personal and Financial Security

As you work together to gather all this data, you will no doubt start to realize how important it is to have this available to those who care about you most!

When all the details are correct and finalized, a number of copies of this document will be created to be kept by the necessary individuals. You will keep one copy for yourself so that you can refer back to it annually and make sure it’s still up to date. Another copy will go to your “Silent Partner,” the person who will be using this information in the event of you becoming disabled or passing away. A final copy will be kept by your retirement planning agency. Your representative will check back with you periodically to see if you need to execute any changes to the information, in which case a new document will be created and distributed. This representative will also be the point of contact for your family members when the time arises to use the information contained in the document.

Just like a will or a Life Insurance policy, a Silent Partner Program is an essential step in looking out for the future of your loved ones. It’s a simple service that many companies provide for free to you and your family.